Externalities in Space

An externality or spillover is a cost or benefit imposed on someone else though the production or consumption of a good. Most goods do not create spillovers, at least in substantive amounts. But some goods or actions do. A recent test by China of an anti-satellite weapon created a large amount of space junk. Space junk is stuff left in space by launching space craft. Space is a big place but the area where people are interested is not. There are orbits that are particularly useful for certain applications. So when a piece of junk is left in space, it becomes a hazard to latter satellites. Should two objects collide, it could not only destroy a valuable piece of equipment but the collision will create even more junk. This link discusses the possibility of a chain reaction occurring creating so much junk that space becomes too dangerous to utilize.